X0202 4 2006-07-03 0 0000808013 NORTH AMERICAN TECHNOLOGIES GROUP INC /TX/ NATK 0001318537 Sponsor Investments, LLC TWO LINCOLN CENTER 5420 LBJ FREEWAY, SUITE 1450 DALLAS TX 75240 0 0 1 0 Common Stock $.001 par value 2006-07-03 4 J 0 91830 A 1064521 D Common Stock $.001 par value 2006-07-03 4 J 0 136200 A 1200721 D Common Stock $.001 par value 2006-07-03 4 J 0 552951 A 8529565 I by Opus 5949, LLC On July 7, 2005, Sponsor Investments, LLC ("Sponsor") entered into a Securities Purchase Agreement (the "July Agreement")by and among North American Technologies Group, Inc. (NATK), Toibb Investment LLC, Michael Toibb, Scott M. and Cheryl L. Hergott Living Trust, Crestview Capital Master, LLC, Midsummer Investment Ltd. and Islandia, L.P. Pursuant to the July Agreement, NATK issued to Sponsor a 7% Convertible Debenture in the original principal amount of $2,325,000 originally due July 7, 2006 ("July Debenture"). The July Debentures were extended to provide for a December 31, 2006 due date. The July Debenture allows NATK to make quarterly interest payments to holders of the July Debenture by issuing shares of NATK common stock, $.001 par value ("Common Stock"). Pursuant to the July Agreement, second quarter interest in the amount of $41,139.58 was converted at a rate of $0.448 which resulted in the issuance of 91,830 shares of Common Stock. On December 28, 2005, Sponsor entered into a Securities Purchase Agreement (the "December Agreement") by and among NATK, Crestview Capital Master, LLC, Enable Growth Partners, LP, Enable Opportunity Partners, LP, Midsummer Investment Ltd. and Islandia, L.P. Pursuant to the December Agreement, NATK issued to Sponsor a 7% Convertible Debenture in the principal amount of $2,935,606 due December 31, 2006 and,on May 9, 2006, NATK issued to Sponsor an additional Debenture under the December Agreement in the principal amount of $880,681.80 (collectively the "December Debentures"). The December Debentures allow NATK to make quarterly interest payments to holders of the December Debentures by issuing shares of Common Stock. Pursuant to the December Agreement, second quarter interest in the total amount of $61,017.63 was converted at a rate of $0.448 which resulted in the issuance of 136,200 shares of Common Stock. NATK and its subsidiaries, TieTek LLC and TieTek Technologies, Inc., are parties to a Construction Loan Agreement dated February 4, 2004, as amended, with Opus 5949 LLC ("Opus") (the "Construction Loan") with a principal amount of $14,000,000. On July 7, 2005, the parties entered into an Amended and Restated Promissory Note ("Amended and Restated Note") pursuant to which NATK may make quarterly itnerest payments to Opus in the form of shares of NATK common stock, $.001 par value ("Common Stock"). Second quarter interest due and payable to Opus was $247,722. The Common Stock value (determined as of the 20 trading days prior to July 3, 2006) was $0.448 which resulted in the issuance of 552,951 shares of Common Stock to Opus. Sponsor and Opus are ultimately under the common control of Consolidated Investment Services, Inc., a Nevada corporation. The reporting person disclaims beneficial ownership of these securities except to the extent of its pecuniary interest therein, and the inclusion of these shares in this report shall not be deemed an admission of beneficial ownership of all of the reported shares for purposes of Section 16 or any other purpose. By: Herakles Investments, Inc., Managing Member; By /s/ Heather Kreager, Vice President 2006-07-06